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These Asian shares have fallen sharply since their IPOs in 2021 and light after their first day beneficial properties

A Thai investor checks an electronic board that displays stock prices.

Amphol Thongmueangluang | SOPA pictures | LightRakete | Getty Images

Some Asia Pacific IPOs in 2021 have seen a significant turnaround since their strong launches.

At the top of the list is the Chinese short video company and Tiktok rival Kuaishou, which more than doubled its issue price on its debut in February. According to Morningstar, this was the only Asian listing among the five largest IPOs in the world this year by transaction size.

However, at the close of Wednesday's Hong Kong market, the stock was 77% below those first-day gains.

Elsewhere, shares in Indonesian e-commerce company Bukalapak have also fallen sharply after rising nearly 25% on its first day of trading. At the close of trading on Wednesday, the share is now 57% below this level.

Another Chinese stock that has plummeted from its initial gains is JD Logistics, which raised more than $ 3 billion when it went public. The stock was 36% below its closing price on the first day, based on the closing price on Wednesday.

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Those losses can be attributed to a number of problems, including Beijing's ongoing crackdown on China's tech sector, which resulted in giants like Alibaba and Meituan being fined heavily.

US Treasury bond yields have also risen as the Federal Reserve signals that it will soon begin normalizing monetary policy. In such conditions, investors tend to avoid stocks in sectors like technology. These stocks could be adversely affected by rising interest rates, which would affect a company's ability to finance growth and also make future cash flows less valuable.

The fast-spreading Omicron-Covid variant has also continued to weigh on investor sentiment and dampened risk appetite in recent weeks, with questions about the potential economic impact of the new variety remaining.

Not unique in Asia

Certainly, poor post-IPO performance isn't specific to the region.

In a December note, Pitchbook's James Thorne and Jordan Rubio highlighted the 2021 blockbuster market debuts in other parts of the world, which have also fallen sharply since going public.

One such example was Chinese ride-hailing company Didi, which announced earlier this month that it would be going off the New York Stock Exchange less than six months after going public. It also plans to debut in Hong Kong instead, amid reports of political pressure from Beijing.

Other US-listed companies that have seen mega IPOs, such as South Korea's Robinhood and Coupang, have also "lost significant value," they said.

“This lackluster performance has cooled the IPO market, which has resulted in some new issuers delaying or downsizing their IPO plans. With all said and done, 2021 could be a high point for the IPO market that may not be reached "for years to come," said Thorne and Rubio.

Aswath Damodaran of New York University told CNBC earlier this month that the post-IPO slump could be due to some investors buying into the "big market deception".

Such investors "don't do their homework" like reviewing these companies' business models, and the reality usually begins when the first earnings report is released, said the finance professor at NYU's Stern School of Business.

"It's a bit of a disturbing sign, but I don't think it's a red flag in and of itself. I think it's more of a sign of how companies have gone public, many with small revenues, large losses and lots of potential . " "Said Damodaran.

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